CMS is seeking public comment on what should count as “reasonable and relevant” terms in contracts between Medicare Part D plan sponsors and network pharmacies, with comments due Nov. 23, according to a Sept. 24 request for information in the Federal Register. The SBA’s Office of Advocacy flagged the deadline to small businesses Nov. 9.
Part D plans must already contract with any pharmacy that accepts their standard terms and conditions, and those terms must be “reasonable and relevant,” but CMS has never defined the phrase. The request is a first step toward implementing a provision of the Consolidated Appropriations Act of 2026 that makes the standards apply to plan years starting on or after Jan. 1, 2029.
CMS asked for information on:
- Reimbursement and dispensing fees: Whether fees cover pharmacies’ costs, how they are set, how they vary by pharmacy type and service, how predictable final reimbursement is at the time of dispensing and whether CMS should set reimbursement methodologies or rates.
- Specialty pharmacy: How specialty designation affects reimbursement, fees, performance measures and audits.
- 340B: Whether Part D contract terms specific to 340B patients are common and how plan sponsors decide when a claim is for a 340B patient whose drug cost the pharmacy less than the plan’s negotiated price.
- Contract terms and transparency: The complexity of contracts, whether pharmacies get complete reimbursement information, including ingredient cost methodology, performance measures and direct and indirect remuneration fees, when a contract is offered.
- Quality, audits and limits: Pharmacy performance measures, auditing practices and any restrictions plan sponsors place on dispensing.
Responses can be submitted under Docket CMS-2026-3037 on regulations.gov.
The provision follows a broader push on PBM reform. The Consolidated Appropriations Act of 2026 included PBM provisions that pharmacy groups backed, including a requirement beginning in 2029 that any willing pharmacy be able to participate in Part D networks. The bipartisan health package that carried it was unveiled in January.
The request comes as Part D plan sponsors also face a changed cost environment. CMS is ending its Part D Premium Stabilization Demonstration at the end of 2026, a year earlier than planned, bringing standalone drug coverage back to “traditional market conditions.” CMS said in September that the average standalone premium would rise by less than $1 a month in 2027, while KFF found it would rise by $17 a month for enrollees who do not switch plans.
